The risks affecting travel in 2021
Looking back, nobody could have predicted the pandemic and its effects on the travel industry, not even Riskline analysts. But as 2021 gets started, Adam Schrader, Director of Operations at Riskline, looks ahead at the trends that will shape the travel sector, including the further effects that Covid-19 might have
In late 2019, even as Riskline analysts around the world were forecasting the potential for an outbreak of infectious disease in the coming year, we could not have predicted the manifold ways in which a novel pandemic would affect our lives, our work and the world more broadly. Even the most thorough assessment of a future pandemic could not have anticipated the consequences of the decisions made by so many governments, public health officials and individuals last year.
While there is hope that some parts of the world will see the end of the pandemic this year, its effects will continue to be felt in 2021 and beyond. It's not yet clear the extent of the damage to healthcare systems or how long it will take them – and, critically, their workforce – to recover. Nor is it known the long-term effects on populations that were denied or postponed critical care or vaccinations for other deadly diseases. What's likely to be with us well into the future is the accompanying 'infodemic' – that virus of misinformation that often overwhelms sound public health messaging.
These and other key trends for the year ahead have been researched by Riskline’s global team of analysts and provide useful guidance for companies planning and managing employee travel in the year ahead.
1. Continued impact of Covid-19 on global travel
Even as the global travel industry gradually recovers from the absolute standstill that it experienced through most of 2020, the pandemic’s disruptive and ever-changing effect on the travel ecosystem will certainly continue this year. The desire for countries to limit exposure to Covid-19 will put pressure on travellers to obtain mandatory documentation relating to insurance, testing, pre-approved accommodation and, eventually, vaccination, prior to travel, which imposes additional cost burdens on travellers.
Entry and exit restrictions imposed by governments or their assessment of the Covid-19 situation in a traveller's country of origin change at short notice, further complicating global travel. Travellers in most countries should continue to expect measures such as health screening, quarantine and testing, socially distanced seating arrangements and contactless check-ins or transactions at airports, major public transport hubs, hotels and other facilities. Expect renewed lockdowns in high-risk areas and a reduction in capacity for transportation services of all kinds to be the new norm in 2021.
2. Severity of natural disasters
Due to climate change, the effects of natural disasters, such as tropical and winter storms, wildfires and monsoon rainfall in 2021 will continue to be more severe and emergency services personnel will be unable to respond to them in a timely manner in countries grappling with a new wave of Covid-19 infections. The trend will be similar when natural disasters hit countries this year, as emergency services are still understaffed and stretched thin and most resources have been allocated towards tackling the Covid-19 outbreak. Countries particularly at risk from natural disasters amid an outbreak during 2021 include the US, Italy, Kazakhstan and Russia, during the winter-storm season (January to March); the US, Brazil, Greece and Indonesia (April to August), and Australia and New Zealand (January to April) during the wildfire season; and India, Bangladesh, Vietnam, Thailand, Philippines, China and Pakistan during the cyclone and monsoon seasons (May to November).
3. Overburdened health systems
The Covid-19 pandemic has pushed most health systems to their limits, exposing long-standing gaps in public health infrastructure and healthcare in many countries. A World Health Organization (WHO) study from 105 countries indicates that some 90 per cent of countries experienced disruptions to essential healthcare services, with low- and middle-income countries reporting the greatest difficulties during the Covid-19 pandemic. Routine immunisation, diagnosis and treatment of non-communicable diseases, cancer and malaria, as well as family planning, contraception and treatment for mental health disorders have been the most affected. Distressingly, emergency services also experienced disruptions in many countries. The pandemic will continue to test the ability of health systems to withstand shocks while maintaining routine functions and mitigating downstream health effects into 2021 and beyond, with Somalia, Central African Republic, South Sudan, Afghanistan, Yemen, Syria, Chad, Niger, the Democratic Republic of Congo, Mozambique, Sudan, Cameroon, Libya, Iraq, Nigeria, Uganda as well as Ethiopia, Eritrea, Haiti and Papua New Guinea, among the countries with the weakest capacity to cope with the added burden of the pandemic.
4. Global political uncertainty amid a post-Brexit UK and post-Trump US
On 1 January 2021, the UK completed its year-long transition period following the country's exit from the European Union (EU), and the effects will be just one of the several uncertainties to watch out for this year. While Democrat Joe Biden's victory in the 2020 US presidential election generated optimism, he will have big challenges ahead in economic recovery and fighting the Covid-19 pandemic. Countries will have to consider whether the reversal of many of the Trump administration's actions by a Biden administration will not simply be reversed should a Republican be elected in 2024, and plan accordingly. France, with a presidential election approaching in 2022, will likely be the focus of US attention, more so than the UK. While a Biden administration will shore up alliances, countries will enter into regional blocs less dependent on the US in the event of further political turmoil. NATO will, in particular, have to address the Turkish elephant in the room as President Erdogan continues to insert himself in the domestic politics of other European member states and engage in military adventurism across the Middle East and Southern Caucasus. Additionally, Asia-Pacific partners such as Taiwan, Japan, South Korea and Australia, will demand greater attention to deal with an emboldened People's Republic of China.